Because some people seem confused what the point is -- the point is that right now there are a lot of blockchain/NFT/"metaverse" games that are making ridiculous bank by doing big presales of virtual plots of "land" on the basis that they are going to turn into big UGC-based platforms to rival Steam, Roblox, etc.
I conduct an analysis that looks back over the 30+ year history of MMO's and find that anytime we see true "land-like" assets in multiplayer online games, we also tend to see digital "housing crises" that have a lot of eerie parallels to the ones we see in the real world, and they play out in ways that closely match the predictions of Adam Smith, David Ricardo, and Henry George.
This is interesting for several reasons:
- It suggests that these big blockchain/NFT/"metaverse" games are headed for trouble long term as their user growth stagnates
- It gives us a place to learn lessons about policy interventions that might have something to say about the real world (Henry George's Land Value Tax was independently re-derived from first principles for use in EVE, and it ended the recession that plagued their early launch days)
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TL;DR -- virtual land presales are a great way to make a quick buck and leave your investors holding the bag, but they're not a great way to build a sustainable creator-driven UGC platform.
Making ridiculous bank by doing big presales of virtual plots of "land" on the basis that they are going to turn into big UGC-based platforms to rival Steam, Roblox, etc.
The key words being "presales" and "they are going to turn into". That's an investment.
Back in 2018, the SEC started bringing the hammer down on "initial coin offerings" to US persons. They apply the "Howey test" [1] to determine whether something is an investment.
First the SEC went after the total scammers. Then they sent letters to every ICO advertising in the US, asking them why they hadn't registered with the SEC for an initial public offering. Where's that prospectus and S1 filing? Many ICO promoters frantically returned the money. The SEC continues to go after the ones that didn't, as you can see on the SEC enforcement page.[2] About one ICO per month gets heavily penalized. Some promoters go to jail. Glenn Arcaro, who was behind BitConnect, has his sentencing hearing on Friday.[3]
We don't hear much about ICOs any more.
NFTs were invented mostly as an attempt to create "collectables" which were not regulated investments. Now, that's OK if you're buying something that already exists, like a Bored Ape Yacht Club NFT. But if you're buying a ticket for something that doesn't exist yet, like virtual land in a virtual world that isn't actually running yet, that's an investment.
So far, the SEC hasn't hammered any NFT operators. The SEC is complaint-driven. They wait until the complaints "I lost my life savings buying land in ..." start coming in.
Probably the first promoters who get in serious trouble will be the ones who overpromised what their nonexistent virtual world would do, and delivered nothing.
California Business and Professions Code 22507: "the ticket price of any event which is canceled, postponed, or rescheduled shall be fully refunded to the purchaser by the ticket seller upon request."[1] The seller thus has the financial risk if the event is cancelled. This is coming up a lot during the epidemic.
In the case of UO the game no longer exists commercially so any ownership on servers has vanished as well. You can run your own servers but the populations are generally so small now that there is an abundance of space.
I don't see that as a problem, I see that as an opportunity for other people to offer something equivalent/better at lower price.Both the real and virtual worlds are and could be respectively big.If people try to "merch" the virtual lands so be it, it's one more reason to think of something more affordable for the masses.
Because some people seem confused what the point is -- the point is that right now there are a lot of blockchain/NFT/"metaverse" games that are making ridiculous bank by doing big presales of virtual plots of "land" on the basis that they are going to turn into big UGC-based platforms to rival Steam, Roblox, etc.
I conduct an analysis that looks back over the 30+ year history of MMO's and find that anytime we see true "land-like" assets in multiplayer online games, we also tend to see digital "housing crises" that have a lot of eerie parallels to the ones we see in the real world, and they play out in ways that closely match the predictions of Adam Smith, David Ricardo, and Henry George.
This is interesting for several reasons:
- It suggests that these big blockchain/NFT/"metaverse" games are headed for trouble long term as their user growth stagnates
- It gives us a place to learn lessons about policy interventions that might have something to say about the real world (Henry George's Land Value Tax was independently re-derived from first principles for use in EVE, and it ended the recession that plagued their early launch days)
---
TL;DR -- virtual land presales are a great way to make a quick buck and leave your investors holding the bag, but they're not a great way to build a sustainable creator-driven UGC platform.